Veteran ex-broker Chuck Roberts for the past two years has been at the center of investor complaints against his brokerage firm, Stifel Nicolaus & Co, where he worked since 2016 before being barred from the securities industry this summer. There appears to be no slowing down in the tide of litigation against the firm, with Stifel in August settling an investor claim involving the former broker for $10.25 million.
“We have 19 more investor claims, and we continue to investigate and file new cases on behalf of customers,” said Jeff Erez, a plaintiff’s attorney. “And we are seeking additional discovery regarding the circumstances of [Roberts’] termination.”
A spokesperson for Stifel Financial Corp., the parent of Stifel Nicolaus, did not comment on Friday.
Roberts left Stifel in July and days later was barred from the securities industry. Roberts refused to appear to testify to FINRA, resulting in his being barred from the securities industry for failing to cooperate with the regulator. According to the FINRA order, he consented to FINRA’s findings without admission or denial.
According to Roberts’ BrokerCheck profile, Stifel settled the $10.25 million, which was filed by clients in 2023, on August 6. The product in question, like other claims involving Roberts, were structured notes. The clients originally asked for $5 million in damages, so Stifel’s settlement was more than twice the initial alleged damages.
The claimants, meaning customers, in the matter, breach of fiduciary duty, negligence and other claims, according to the BrokerCheck report.
The investor complaints, in general, stem from client losses linked to Roberts’ structured-note strategy, with customers claiming the strategy was not in their best interest or that Roberts had inaccurately described the products.
The performance of structured notes is typically tied to an underlying asset, such as a specific stock or an index such as the S&P 500 stock index.
Most notably - and perhaps most damaging - to Roberts was an industry arbitration panel’s decision in March to award clients of Stifel and Roberts $132.5 million in damages and legal fees in a dispute adjudicated under the aegis of FINRA Dispute Resolution Services.
In that investor complaint, David Jannetti and family members in 2023 sued Stifel Nicolaus & Co., the broker-dealer subsidiary of Stifel Financial, claiming at least $5 million in damages related to investments in structured notes, a strategy that has resulted in several previous significant arbitration claims and damages to clients.
The size of the Jannetti award stunned the industry. The arbitrators ordered Stifel Nicolaus to pay Jannetti and family $26.5 million in compensatory damages, $79.5 million in punitive damages, and $26.5 million in attorney’s fees and costs. Awards of punitive damages are rare in FINRA arbitration cases.
Stifel in May in federal court in Miami filed a motion to vacate that award.
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